The first transfer of loans from the troubled banks has fallen further behind schedule. Initially, the time-scale for the transfer of up to €19 billion of bad loans to the National Asset Management Agency was before Christmas 2009. It will be the end of the month before the first loan transfers will now happen.
Ciaran Callaghan, analyst with NCB said the banks probably had significant “administrative” hurdles to deal with concerning the loans being transferred to NAMA.
The amount of detail demanded by the bad bank is said to have been extremely demanding bank sources have previously indicated.
In all €77bn of bad and other property loans are due to transfer to NAMA with the entire process expected to be completed before the end of the third quarter of the year.
The banks are due to get €54bn from the state for those loans, representing a discount of 30%.
Businesses hope the €54bn in fresh funding to the banks will lead to a better lending environment for those currently struggling to keep their operations on track.
Those hopes have been questioned by the IMF.
In a letter last April to the Minister for Finance, Brian Lenihan, the International Monetary Fund said the establishment of NAMA would have no material impact on the amount of money the banks would be in a position to lend to hard pressed customers.